I don't like the idea of governments holding millions of Bitcoins.

[mv1986]

What if governments that acquire Bitcoin collude to break the network or introduce absurd changes?

Yep. And what if Trump said that, unless they make certain changes to the Bitcoin core (e.g. to allow US surveillance to stop payments for now-illegal abortions)

You both don't know how changes are introduced in Bitcoin, and it shows.

It's software. Changed by human beings. Human beings who can be influenced by the threat of imprisonment or harm.

Bitcoin does not magically make one immune to violence or the threat therein. If the major mining companies for Bitcoin, along with every publicly-known broker, along with every publicly known wallet software, along with every known vendor on the internet, were all ordered to do something today, they would follow those orders. If the previous fork was deemed illegal and punishable by prison if anybody would use it, then nobody would use it save a few dozen now-criminals who would now be playing around with an illegal alt-coin at that point.

You really don't seem to understand the power governments have over people. If you've lived your life feeling that, then that's great for you because it means you worry about a lot less than the rest of us do .

Tell me when for the last time all governments in the world cooperated in order to achieve a single goal? You are talking as if there was either only one government or as if it was possible that all governments work towards one goal. There is competition among governments. It is not going to happen that there will be one international law, one international anthem, one international language or one international of anything. Global harmonization of any issue is NOT possible. You can go through all the possible examples. Climate change counter measures same thing.

A singular universal currency would have been the last thing on earth that all countries in the world, all governments in the world would have agreed to. One government can try to shut down a lot of things in regards to Bitcoin even though as mentioned before, China couldn't do it, India couldn't do it, nobody could do it.

Governments are just finding out that Bitcoin is a decentralized truth engendering protocol coordinating who owns what based on the UTXO model. There is nothing they can do about it. The US knows if they call out a ban tomorrow, 50 other countries will say "here we go, we are Bitcoin friendly". BRICS will go for it. Whoever.

It is naive to believe that

the major mining companies for Bitcoin, along with every publicly-known broker, along with every publicly known wallet software, along with every known vendor on the internet, were all ordered to do something today

would ever become true. Why would some Asian wallet provider listen to what the US has to say or vice versa? Bitcoin is truly fostering competition. There is no stopping it in a local or regional or national sense. That's the problem everyone in the world by now understood. And since there is also never going to be a global joint effort against a decentralized system, what do you think how this will play out?

[BlackHatCoiner]

It's software. Changed by human beings. Human beings who can be influenced by the threat of imprisonment or harm.

You cannot force a change in decentralized systems. Authoritarians have no influence here. You can make all the threats you want, but ultimately, you'll only end up excluding yourself from it. Try to explain the process of "changing Bitcoin" by malicious parties, and you'll see yourself that it's infeasible even in theory.

[Fivestar4everMVP]

It's software. Changed by human beings. Human beings who can be influenced by the threat of imprisonment or harm.

You cannot force a change in decentralized systems. Authoritarians have no influence here. You can make all the threats you want, but ultimately, you'll only end up excluding yourself from it. Try to explain the process of "changing Bitcoin" by malicious parties, and you'll see yourself that it's infeasible even in theory.

You are right and I completely agree with you, some of us seem not to still understand in clear terms, what decentralization is really all about.
In a true decentralized system, even the creator of that system have no access to it, and it's always accessible to anyone around the world as long as there is an internet connection and the user have the necessary tools and required knowledge to effectively operate the system.

If bitcoin (for example) was not decentralized, the network and so on, bet my @** that the government would have long shut it down, but as it stands, they have no power or means of doing such, all they can only do is ban their citizens, and possibly block access to any bitcoin and crypto related sites, which is exactly the same thing that the Nigerian government have done to crypto exchanges, but still many of us still access those sites through VPN.

[Casdinyard]

Some Bitcoiners seem to be enthusiastic about plans by politicians to buy or hold big amounts of Bitcoin as part of a "strategic reserve". In particular, Kennedy's announcement that in the (extremely unlikely) case he wins the US election he could buy up to four million Bitcoins as a strategic reserve.

I don't like this idea for the following reason:

States holding such a big amount could interfere too much into Bitcoin's power equilibrium.

Let's see the following hypothetical scenario:

- The US buys 1-2 million BTC, other states/central banks like the ECB, China and India follow, and together they hold let's say 5-7 million (about 25%-35% of all existing Bitcoins).
- Now the FATF sets up a new "recommendation" that a blacklist for "sanctioned" Bitcoin addresses (like those already implemented in Tether and other stablecoins) would be desirable.
- As almost all states obey the FATF's guidelines, together they pressure Bitcoin Core team to implement a blacklist for "sanctioned" Bitcoin addresses which miners have to obey, or alternatively build an own Bitcoin client with a modified protocol.
- This would of course need a hard fork. But they have a lot of coins, so they can increase pressure by threatening to sell all Bitcoins on the chain which does not follow the hard fork. This has a precedent: it's what Ethereum did when they pressured for the hard fork rewinding the TheDAO hack in 2016.

A similar scenario was already discussed for ETFs. But ETFs would never hold so many coins as some are desiring for states/governments to hold, and also their customers could react, so for ETFs I don't see this danger. Up to 1 million, even 2 millions of BTC hold be states/governments/central banks would still not be something to be worried about. But if all bigger states try to buy millions, then it could become really dangerous.

I don't think Bitcoin would "die" in such a scenario, but I think it could lose a lot of value and confidence. And the scenario is not that unlikely to be ignored.

What do you think? I added a poll also with an intermediate scenario like the one announced by Trump, which would lead to a couple of hundred thousands of BTC hold by states, but not millions.

I've been talking about this for a while now. They treat bitcoin as if it's some kind of parlor trick they could use to keep the people clapping for them all because it sells like hotcakes. Biggest offender out here being Trump cause at the very least we know Kennedy's really one for the cryptocurrency industry unlike Trump, even though his idea of integrating cryptocurrencies in the US economy's a little too misplaced for the lack of a better word. It just angers me to know that these clowns who were massive antagonists of cryptocurrency and its integration within the economy is suddenly now so accepting of it, to the point that they'd even use it as a strategic reserve, which is one more thing that I hate about this shit.

Just hoping that the people in here is able to see all of this for what it really is, a way for these politicians to leverage the bitcoin enthusiasts' votes towards their favor, and finally realize why they shouldn't just hop on anything or anyone notable who blabbers about bitcoin. We've been through this with Elon Musk already for God's sake.

[d5000]

I see a HUGE difference in both strategies. If a government says they are going to actively build a reserve with their own national currency, then their stance on the matter is fundamentally different and also, just imagine what kind of ill-considered incentive there would be for authorities if they say they seize their way to their own substantial reserve?

I get where you're coming from and from a game theory perspective you could be right that an actively buying government could have incentives for an even more crypto-friendly policy.

However, I don't agree that a seizing-based strategy would be automatically "hostile". The advantage to build the reserve from seizing is to bypass the market, its fees and other costs like slippage. If it's clearly defined by law when you can seize and which goal you have, then it can be a "friendly" strategy as well.

It would actually be bad news for the Bitcoin community as that would certainly imply a more hostile stance on Bitcoin, imposing more restrictions on how to use Bitcoin and for what purposes and so on and so forth, creating more space to justify seizures.

I would actually argue that this is countered by the issue that if the government wants to accrue value with its Bitcoin reserve, its stance can't be hostile to crypto. So my guess is that the government would be incentived to clearly lay out its "seizure" policy and limit it to criminal proceedings that would also result in seizures of any other asset they seize, and not trying to find more reasons to seize.

Also a government is not a monolithical entity. The authority responsible for seizures (judicial system) and the authority responsible for the Bitcoin reserve will probably not follow the same goals.

About the poll: the option of an actively buying government is obviously legit, but actually less popular than I thought ... that might have to do with the bias of my first post in this thread.

[legiteum]

It's software. Changed by human beings. Human beings who can be influenced by the threat of imprisonment or harm.

You cannot force a change in decentralized systems. Authoritarians have no influence here. You can make all the threats you want, but ultimately, you'll only end up excluding yourself from it. Try to explain the process of "changing Bitcoin" by malicious parties, and you'll see yourself that it's infeasible even in theory.

LOL, okay. People have been forced at gunpoint to do things like kill their own families before, but no, they would never, "violate my own understanding of this software system's integrity, even though doing so will make me more money".

Again, I wish I lived in your world where you think you can do anything you feel like doing regardless of the law, or where you have no fear whatsoever of malicious governments--that a specific software system can protect you from all of those things. Personally I need to try to sleep at night knowing that politics could change anything and everything in the world and in my own personal life. If you can manage to live without those fears, then by all means stay inside of that thought bubble .

[mpoletiek]

I wouldn't be so afraid if BTC scaled in terms of non-custodial tx's per second.... but...

Looks like the big banks will buy the miners next as they start to fail.

[BlackHatCoiner]

[...]

Blah-blah-blah. All I asked was to try and explain the process of changing Bitcoin without the people's consent. Governments around the world can make Bitcoin illegal, but they cannot change it, because they cannot force that behavior without the people's consent. The best they can is create yet another fork.

[legiteum]

[...]

Blah-blah-blah. All I asked was to try and explain the process of changing Bitcoin without the people's consent. Governments around the world can make Bitcoin illegal, but they cannot change it, because they cannot force that behavior without the people's consent. The best they can is create yet another fork.

It absolutely would not be "without people's consent", and that's the whole point. People acting under the threat of prosecution and/or having their wealth confiscated by the government will absolutely consent to whatever the government tells them to do.

[cryptosize]

What if governments that acquire Bitcoin collude to break the network or introduce absurd changes?

Yep. And what if Trump said that, unless they make certain changes to the Bitcoin core (e.g. to allow US surveillance to stop payments for now-illegal abortions)

You both don't know how changes are introduced in Bitcoin, and it shows.

It's software. Changed by human beings. Human beings who can be influenced by the threat of imprisonment or harm.

Bitcoin does not magically make one immune to violence or the threat therein. If the major mining companies for Bitcoin, along with every publicly-known broker, along with every publicly known wallet software, along with every known vendor on the internet, were all ordered to do something today, they would follow those orders. If the previous fork was deemed illegal and punishable by prison if anybody would use it, then nobody would use it save a few dozen now-criminals who would now be playing around with an illegal alt-coin at that point.

You really don't seem to understand the power governments have over people. If you've lived your life feeling that, then that's great for you because it means you worry about a lot less than the rest of us do .

If you truly believe what you say, then there is no true "democracy". It's a dictatorship pretending to be a "democracy". Take your pick and tell us what's the point of elections.

Using gunpoint violence at best will make you spill the beans (12-word seed phrase), but it's not going to change the consensus rules of a decentralized network that is spread all over the world.

You think USA "owns" BTC due to hashrate, but some people also thought the same about China back in 2021 when lots of miners stopped working there.

What you're suggesting is that a government can change TCP/IP rules and create a totally new protocol, because "reasons". How come nobody has done it yet?

Feel free to tell us why Haypenny uses good ol' TCP sockets based on IPv4 and why it doesn't use the superior IPv6, since IPv4 is considered old, antiquated and inadequate due to its limited address space.

Both BTC and the internet have immense inherent value, because nobody can "outlaw" them or change their consensus rules.

If BTC could be controlled by China or USA or Russia, it would cost a lot less. Its selling point is that nobody can control/freeze/censor it.

Even if pools could perform a 51% attack by collusion, they just won't do it, because it would destroy their precious income. Only wokies/commies are willing to destroy their income ("go woke, get broke").

Bitcoin is not a centralized payment system like Haypenny, stop confusing them. Yes, the government can change Haypenny easily, but chances are they won't care about a worthless shitcoin.

Personally I need to try to sleep at night knowing that politics could change anything and everything in the world and in my own personal life. If you can manage to live without those fears, then by all means stay inside of that thought bubble .

Please seek help from a certified psychiatrist. I really mean it. You have unfounded fears.

Trump will not release a shitcoin (TrumpCoin) and he has no power at all to hurt Bitcoin.

Stop worrying about non-existent things, it seriously hurts your mental health!

[...]

Blah-blah-blah. All I asked was to try and explain the process of changing Bitcoin without the people's consent. Governments around the world can make Bitcoin illegal, but they cannot change it, because they cannot force that behavior without the people's consent. The best they can is create yet another fork.

It absolutely would not be "without people's consent", and that's the whole point. People acting under the threat of prosecution and/or having their wealth confiscated by the government will absolutely consent to whatever the government tells them to do.

This sounds like North Korea. Where's the fabled "American freedom"?

Even if that's the case, USA doesn't own 100% of the hashrate.

If BTC loses 50% of the hashrate overnight, then people will have to endure slower transactions (each block would take roughly 20 minutes instead of 10) for 2016 blocks/4 weeks at most (until the next difficulty adjustment).

I suggest to study BTC more, because you don't really seem to understand even the basics and it shows big time.

[legiteum]

It's software. Changed by human beings. Human beings who can be influenced by the threat of imprisonment or harm.

If you truly believe what you say, then there is no true "democracy". It's a dictatorship pretending to be a "democracy". Take your pick and tell us what's the point of elections.

Governments wield force, and under a democracy (and a republic), the use of that force is directed by popular vote.

Hence if Americans democratically elect (say just as a hypothetical) a convicted criminal with a history of running scams against his own supporters as their president, and Americans elected a Congress that supported that president, then... the US could use its formidable forces to compel the takeover of Bitcoin.

[PrivacyG]

I know this is 7 pages in but I really wanted to speak about the question OP raised.

I honestly do not know what is best.  On one hand I would say it is a great thing if the United States recognizes Bitcoin as a true and valuable Asset.  It would be great.  By recognizing this, they are also accepting the defeat of their battle against Bitcoin.  But on the other hand, so many things and problems can raise.

For one, the Centralization of so many Bitcoins in the hands of only one Entity.  It seems really dangerous if you ask me.  If a few countries get a hold on over 25 percent of existing Bitcoin then subtract how many Bitcoins are possibly lost forever and the percentage increases even more.  This gives them a lot of power we all should wish they will not own due to opportunities they would have to manipulate the Markets, to create FUD et cetera.

But then I would even think about Privacy issues.  If The United States get a hold on even 10 percent of existing Bitcoin, then by selling it they could create a HUGE web of Blockchain Analysis where almost every single Satoshi is supervised, analyzed and processed for various reasons.  One reason could be the typical excuse of trying to catch Criminals who try and Launder Money through Bitcoin.  Owning only a few thousand Bitcoins is nothing.  Owning 10 percent of the Supply is a different beast however.

Am I too paranoid?  I think at first glance it sounds great and optimistic, but then you think it more thorough and it can turn into maliciousness so easily.  So I rather not have them own Bitcoin at all instead, let it be a circulating Currency, let it be spread among citizens and not held by a single Entity that can end up controlling Markets to their liking or resorting to other sorts of malicious acts.

[cryptosize]

It's software. Changed by human beings. Human beings who can be influenced by the threat of imprisonment or harm.

If you truly believe what you say, then there is no true "democracy". It's a dictatorship pretending to be a "democracy". Take your pick and tell us what's the point of elections.

Governments wield force, and under a democracy (and a republic), the use of that force is directed by popular vote.

Hence if Americans democratically elect (say just as a hypothetical) a convicted criminal with a history of running scams against his own supporters as their president, and Americans elected a Congress that supported that president, then... the US could use its formidable forces to compel the takeover of Bitcoin.

It's no longer a "popular vote" if the US government goes against Bitcoiners' wishes.

It's a dictatorship pretending to be something else. Don't be afraid to admit it.

[legiteum]

It's no longer a "popular vote" if the US government goes against Bitcoiners' wishes.

It's a dictatorship pretending to be something else. Don't be afraid to admit it.

Ah I see. If you win the election it's a democracy, and if you lose the election it's a "dictatorship".

[d5000]

@cryptosize: In general I agree that Bitcoin should be resilient against government attacks until a certain point. But a point, or an amount, where government intervention becomes problematic, in my opinion does exist. 30% of all Bitcoins owned by governments, or 20% by a single nation like the US, would be definitely too much. The manipulation potential is simply too high.

The "problematic amount" however has also to do with the, let's call it "ethical maturity" of the Bitcoin community. If most users would support changes to the protocol which go against privacy and censorship resistance, because they don't care about these values, then the manipulation potential is higher than if the community is aware of these issues and would fork away always if there is any manipulation attempt to the protocol.

I don't rule out Bitcoin's community can reach such a high resilience that even a threat by governments owning 30% of all BTC could be repelled in the way you described (UASF, alternative implementations etc.). But judging from the current state of Bitcoin, with many speculative investors, I remain cautious.

If The United States get a hold on even 10 percent of existing Bitcoin, then by selling it they could create a HUGE web of Blockchain Analysis where almost every single Satoshi is supervised, analyzed and processed for various reasons.

Interesting aspect, but I think I disagree here. Government reserves would be mostly hold in cold storage and not intervene much in the transaction activity. So the simple fact that they own the Bitcoins don't really give them an advantage for chain analysis, I think.

It would be different if there is a government-sponsored wallet software, for example to pay taxes and other stuff. Well, we had that already: Chivo in El Salvador. And they had massive privacy problems, unfortunately. For me Chivo is the main problem in El Salvador's Bitcoin policy, followed by the intransparency of the Bitcoin purchases until last year.

[BlackHatCoiner]

It absolutely would not be "without people's consent", and that's the whole point. People acting under the threat of prosecution and/or having their wealth confiscated by the government will absolutely consent to whatever the government tells them to do.

It's still unclear to me what's going to happen to the protocol if the US citizens are forced to follow different rules. The worst that can happen is to split the network into two; the "original Bitcoin" and the "US Bitcoin". The rest of the world will obviously support the pro-freedom fork, and sell all their "US Bitcoin" coins to the US citizens, which would make "US Bitcoin" plummet.

This is why I've asked you to explain the process. Because it doesn't make any sense, even in theory. Really, imagine you're corrupt Trump, and want to pass a law that will "change Bitcoin". What are you going to pass exactly?

One reason could be the typical excuse of trying to catch Criminals who try and Launder Money through Bitcoin.

No sane person launders money through Bitcoin in 2024.

[legiteum]

This is why I've asked you to explain the process. Because it doesn't make any sense, even in theory. Really, imagine you're corrupt Trump, and want to pass a law that will "change Bitcoin". What are you going to pass exactly?

You pass a law saying that if you are a Bitcoin miner, you will do X, Y and Z (e.g. change the software to do whatever); the law further states that any financial institution offering customers the thing called "Bitcoin" shall use miners following these laws; the law further states that any vendor accepting Bitcoin as a form of payment shall use these miners; the law further states that it's a crime to try attempt fork the project (this is exactly what Legal Tender laws in the US do for the US dollar btw).

Yes, nothing would stop you from creating something called, "realbitcoin" if you were able to evade the reach of the US government, but no current major holders of Bitcoin would do that because they thing you will have created would not be tradable with any significant population e.g. it would be extremely low in value. If you wanted to secure the value of your current Bitcoin holdings, you would accept the US laws and follow them, as would virtually every holder of Bitcoin who doesn't feel like lighting money on fire to make a point.

Maybe I missed a detail or two here, but when you have infinite power to compel humans, there's no winning against the government.

[BlackHatCoiner]

Yes, nothing would stop you from creating something called, "realbitcoin"

What's original stays original. What's being created in your scenario is the "US Bitcoin", not the original. The original Bitcoin remains intact, and simply experiences a hashrate decline. Now it's up to the US government to force this behavior. (Deeming their fork as the legal one, and the other as illegal.)

I want to make this clear, because there's some misunderstanding from your part. If the US government wants to change the Bitcoin consensus rules, then they don't actually change the rules; they create an altcoin (or more appropriately, a "fork"), and it's up to them to convince the world that this one is Bitcoin.

I would also imagine a host variety of developers and community contributors who own large amounts of bitcoin to exit the US borders, if their life depends on writing code for Bitcoin.

no current major holders of Bitcoin would do that because they thing you will have created would not be tradable with any significant population

When the US government enacts the fork, all Bitcoin holders will suddenly have coins in two networks. (This is in fact what happened with Bitcoin Cash, when the network split in 2017.) Now US citizens hold "US Bitcoin", which is legal, and the original, which is illegal.

Until this point, everything is understandable. What's supported by no evidence or some actual argument is why would the rest of the world follow a fork that is completely pro-censorship and anti-freedom. What's stopping them from selling the "US Bitcoin" for the original? Why would they want the "US Bitcoin"? They're not threatened by anything, they're not US citizens.

[legiteum]

Yes, nothing would stop you from creating something called, "realbitcoin"

What's original stays original. What's being created in your scenario is the "US Bitcoin", not the original.

Maybe in your own mind, and in minds of a few others, but the only thing most people care about is whether their wallet contains stuff that can be traded for US dollars or some other thing connected to real goods and services.

So you can go ahead and say, "but that's not really Bitcoin", and you'll be pretty lonely in doing so if the thing you call "Bitcoin" buys you nothing, and the thing you say is "not Bitcoin" buys you a nice car for each one and a nice house for 10.

Until this point, everything is understandable. What's supported by no evidence or some actual argument is why would the rest of the world follow a fork that is completely pro-censorship and anti-freedom. What's stopping them from selling the "US Bitcoin" for the original? Why would they want the "US Bitcoin"? They're not threatened by anything, they're not US citizens.

For the same reason the rest of the world follows all kinds of things the US does: our leading economy and our nuclear weapons. Take a look at what the US did to Russia for a recent example, rallying most of the world behind them to create an economic embargo. But in this case it isn't war, it's just some money held by a small group of rich people. The US leaning on other countries for this purpose would be pretty trivial in comparison. And on the flip side, in order to preserve their investment, almost all holders of Bitcoin would want to jump aboard the US version. The US would essentially extort the market, and I hope you don't have to spend too much time in these forums to see what drives about 95% of the posters here .

[cryptosize]

It's no longer a "popular vote" if the US government goes against Bitcoiners' wishes.

It's a dictatorship pretending to be something else. Don't be afraid to admit it.

Ah I see. If you win the election it's a democracy, and if you lose the election it's a "dictatorship".

Are you dumb or are you playing dumb? Not that I have high expectations from Cumala voters...

Here's the ELI5:

When a wannabe government (political party) promises to be pro-Bitcoin (before the elections), then it becomes a government (after the elections) and it shows an anti-Bitcoin stance, that's not a democracy, that's a dictatorship pretending to be something else!

I'm surprised you don't seem to understand this.

Imagine ordering a Coke and getting Pepsi instead. You would sue the shop for misleading advertising.

But accepting politicians and their lies is not misleading advertising?

Try to up your IQ a little bit.

@cryptosize: In general I agree that Bitcoin should be resilient against government attacks until a certain point. But a point, or an amount, where government intervention becomes problematic, in my opinion does exist. 30% of all Bitcoins owned by governments, or 20% by a single nation like the US, would be definitely too much. The manipulation potential is simply too high.

The "problematic amount" however has also to do with the, let's call it "ethical maturity" of the Bitcoin community. If most users would support changes to the protocol which go against privacy and censorship resistance, because they don't care about these values, then the manipulation potential is higher than if the community is aware of these issues and would fork away always if there is any manipulation attempt to the protocol.

I don't rule out Bitcoin's community can reach such a high resilience that even a threat by governments owning 30% of all BTC could be repelled in the way you described (UASF, alternative implementations etc.). But judging from the current state of Bitcoin, with many speculative investors, I remain cautious.

I honestly don't know why it worries you that much.

Bitcoin is not PoS like Ethereum, so holding 30-50% (sounds overly optimistic with a 35 trillion debt, but whatever) of the total supply is not going to give them power to change the consensus rules.

Would it give them power to tank the BTC price? Yes, but only if they're foolish enough to sell the next global reserve currency.

Honestly, I would love it if Satoshi came out of the woodwork and sold his huge 1.1m BTC stash, even if it means that BTC would drop all the way down to $1000.

The only reason whales tend to accumulate more BTC is because the plebs (Average Joe) are not smart enough to buy the fucking dip.

Whales are smart and it's not Satoshi's fault. People are not equal (no matter what leftists say), some have higher IQ than others.

For the same reason the rest of the world follows all kinds of things the US does: our leading economy and our nuclear weapons. Take a look at what the US did to Russia for a recent example, rallying most of the world behind them to create an economic embargo.

USA is a declining empire, nothing lasts forever: https://www.youtube.com/watch?v=OuOcnGAv4oo

For the love of God, wake up and smell the coffee!

Roman citizens back then were exactly like you. Nobody saved them, nobody showed pity for their decadent & arrogant behavior.

BRICs are going to lead the way from now on and you know why?

Because the World Economic Forum backs them up!

They want to bring the decadent, woke US empire and the USD down to their knees. Dedollarization is part of the WEF's Great Reset agenda and they're going to use BTC as the next global reserve currency.

I wouldn't want to live in the US during 2027-2030. You've been warned.